Loyalty Register glossary
Float
The cash a loyalty program holds between receiving payment for points and paying for the rewards they are redeemed for.
Float is the cash a loyalty program holds between the moment it is paid for points and the moment it pays for the rewards those points buy. The term comes from insurance and banking, where money collected now is held until a later claim or withdrawal. In loyalty, float is largest in programs that sell points to partners, because the partner pays when the points are issued and the reward is delivered months or years later.
Updated · By Loyalty Register Editorial TeamRelated terms
Where does loyalty float come from?
Mainly from partners that buy points to give their own customers: co-brand credit cards, hotels, car rental firms and retailers. Delta Air Lines, for example, sells miles to credit card, retail, ridesharing, car rental and hotel companies, with payments typically due monthly based on the miles sold. Its largest such contract is the co-brand card with American Express, which paid Delta $8.2 billion in 2025. In a program that only issues points on its own sales, float is smaller: the business has collected the sale price but owes the reward later.
What is float worth?
The value is the return on cash held before it is needed. In a hypothetical program, $6 million of point sales is held for an average of 24 months before the rewards are paid for, and the business values cash at 3% a year. The financing benefit is about $360,000. If members take 30 months on average to redeem, the benefit rises to about $450,000. Longer redemption times raise the benefit, but they can also be a sign that rewards are hard to reach.
Why is float not free money?
Every dollar of float comes with an obligation. The points behind it are a liability, recorded as deferred revenue, and members can redeem them at any time the rules allow. A program that spends its float as if it were profit can find itself short when redemptions rise, for example after a popular promotion or when a partner relationship ends and members rush to use their balances.
What should you watch?
- The size of the float compared with the liability it is meant to cover.
- How long points are typically held before redemption, and why.
- Concentration: how much of the float depends on a single partner contract.
- What happens to the liability if that partner leaves.